HST Transitional Rules on Housing
Canada - November 18, 2009
- Parksville Qualicum Beach REALTOR®
- Published: Nov 18th, 2009 at 11:44 am
Wednesday, the provincial government announced the HST transitional rules on housing. The press release and backgrounder can be found here: HST Transitional Rules On Housing Press Release.
In the announcement, Finance Minister Colin Hansen acknowledged consumer and industry input on the issue. The province is proposing to increase the threshold for the B.C. HST new housing rebate from $400,000 to $525,000. The province aims to ensure that, on average, purchasers of new homes up to $525,000 pay no more tax due to harmonization. Purchasers of new homes would be eligible for a rebate of 71.43 per cent of the provincial portion of the HST paid on a new home, up to a maximum of $26,250. Homes above $525,000 would receive a flat rebate of $26,250. This is a 30 per cent increase in the threshold and maximum rebate available.
Please take the time to read through the whole document if you can. Some highlights from the Tax Information Notice:
- Generally, builders' sales of newly constructed or substantially renovated homes would be subject to the provincial component of the HST where both ownership and possession of the home are transferred after June 2010. Grandparenting would be provided for certain contracts.
- The proposed transitional rules for new housing, including builder reporting and disclosure requirements, would be administered by the CRA.
- Generally, sales of new homes under written agreements of purchase and sale entered into on or before Nov. 18, 2009, would be grandparented, such that these sales would not be subject to the provincial component of the HST and would not be eligible for B.C.'s housing rebates.
- Grandparenting would be provided for newly constructed or substantially renovated single unit homes, including detached homes, semi-detached homes, and attached homes.
- Grandparenting would not apply to traditional apartment buildings, mobile homes (including modular homes) and floating homes, as the general transitional rules would apply differently to those homes. However, these homes may qualify for B.C. housing rebates.
